Epigenomics AG Reports Q3 and Nine Month 2008 Results

Key Figures (in EUR thousand)

- Revenues: 1,831 in 9M 2008; (9M 2007: 1,809)
- EBIT: -8,536 in 9M 2008; improved by 16% (9M 2007: -10,179)
- Net loss: -8,147 in 9M 2008; reduced by 17% (9M 2007: -9,838)
- Liquid assets: 15,162 at end of September 2008 (Dec 31, 2007:
10,016)

Highlights of Q3 2008

- Progressed PRESEPT Clinical Study
- Executed according to plan in colorectal cancer blood test
commercialization
- Key patent granted in Europe
- Completed clinical study for prognostic prostate cancer tissue test
with excellent results
- Initiated additional clinical study in lung cancer program
- Strengthened management with industry experts in product
development and marketing

Berlin, Germany and Seattle, WA, USA, November 4, 2008 - Epigenomics
AG (Frankfurt, Prime Standard: ECX), a cancer molecular diagnostics
company developing tests based on DNA methylation, today reported
financial results for the third quarter and for the first nine months
of 2008, ended September 30, 2008, and provided a corporate update.

Commenting on the first nine months, Geert Nygaard, the company's
Chief Executive Officer, said: "After the successful financing in the
first half, we have focused primarily on our product development
operations in the third quarter. In particular I would like to
highlight the excellent progress made in the PRESEPT Study, the
successful completion of the clinical study validating our prognostic
prostate cancer tissue test and the initiation of another clinical
study in our lung cancer program. At the same time we continued to
execute on our "Epi 2010" initiative continuously optimizing our
organization while reducing net cash consumption. I am absolutely
convinced that the key additions to our management team with Uwe
Staub joining us from QIAGEN to head our product development and
Friedericke Gerdes joining us from Agendia to head our marketing will
further strengthen our operational and commercial focus and will help
us succeed in delivering on our goals."

Q3 2008 - Operational Review and Highlights

PRESEPT. The PRESEPT Clinical Study Steering Committee recently
reviewed the substantial progress that has been made in the execution
of the PRESEPT Study. In addition, Dr. Timothy R. Church, Professor,
School of Public Health, University of Minnesota has been assigned
responsibility for study results analysis and Prof. Dr. Thomas Rösch,
Director of the Clinic for Interdisciplinary Endoscopy, University
Hospital Hamburg-Eppendorf has been added to the Committee as
representative of the German sites.

In its recent meeting, the study's steering committee strongly
advised Epigenomics, not to undertake an interim analysis of clinical
results in early 2009, but rather to only conduct a final analysis
when enrollment is complete. The Committee recommended this course
to strengthen the overall study design by avoiding the statistical
penalty on the study's overall power incurred by conducting an
interim analysis.

Since starting the PRESEPT Study in Q2 of 2008, Epigenomics has
successfully qualified 17 clinical sites, 12 of which have been
initiated, enrolling nearly 500 subjects in the first three months.
The increased number of clinical sites is expected to now rapidly
ramp up accrual of subjects over the next several months. When the
total of up to 20 clinical sites including three in Germany are
initiated, PRESEPT will be one of the largest commercially sponsored
colorectal cancer screening clinical studies ever conducted.
Epigenomics is providing clinical collaborators, medical
professionals, and the interested public with study details and
regular updates on the progress of the PRESEPT Study on the recently
launched website www.presept.net.

Colorectal Cancer Test Commercialization. In both of Epigenomics' key
collaborations with Abbott Molecular Inc. and Quest Diagnostics Inc.
- each aimed at developing and commercializing a Septin9 colorectal
cancer blood test - significant progress was made in the third
quarter 2008. All required steps in the transfer of the Epigenomics
assay onto the Abbott m2000 platform have been initiated and are on
schedule. Quest progressed in the establishment and validation of a
laboratory-developed test (LDT) for Epigenomics' Septin9 marker,
which is expected to be launched in due course.

Key Patent Grant. Following the notice of allowance in Q3, the
European Patent Office granted Epigenomics' Septin 9 biomarker Patent
EP 1721992 effective October 8, 2008. This grant significantly
strengthens the intellectual property position of Epigenomics'
colorectal cancer blood test, the company's leading product in
development.

Prostate Cancer Prognosis Test. In October 2008 Epigenomics
successfully completed a clinical study in prostate cancer that
demonstrated that patients with elevated PITX2 gene methylation level
had a threefold higher risk of relapse following prostatectomy
compared to patients with low PITX2 methylation. Further the study
demonstrated that the PITX2 methylation status adds clinical
information to established prognostic parameters such as age, Gleason
Score, tumor staging, pre-surgical PSA levels and surgical margin
status. In each comparison, high PITX2 gene methylation indicated a
twofold increase in risk of recurrence. In the group of patients with
an intermediate Gleason Score of 7, which present difficult decisions
for doctors and patients due to difficulty in determining their
prognosis, the PITX2 marker was able to discriminate patients into
those with a high and low risk of disease recurrence. Epigenomics
currently explores several routes of commercialization to make this
test available to doctors and patients as soon as possible.
Lung Cancer Program. Following the successful clinical studies in the
first half of 2008, Epigenomics during Q3 has initiated a larger
clinical study in its lung cancer program using bronchial lavage
specimen. With the data of this study at hand by year-end 2008, the
company expects to decide on the further development strategy for a
bronchial lavage test product.
Key Management Changes. On November 1, 2008, Epigenomics' management
team was strengthened by adding two senior industry experts in
diagnostics R&D and marketing: Dr. Uwe Staub joined Epigenomics as
Senior Vice President Product Development. Dr. Staub comes to
Epigenomics from his position as Senior Director Program Management
for North American R&D at QIAGEN. He managed the human papilloma
virus (HPV) product development projects for cervical cancer and lead
QIAGEN's program management office in Gaithersburg, MD, U.S.A.
Before joining Digene that was later acquired by QIAGEN, Dr. Staub
had spent more than eleven years with Abbott Diagnostics in Germany
and gained experience in product development, operations and
regulatory affairs/compliance. Dr. Staub holds a doctorate degree in
biochemistry from the University of Würzburg, Germany.

Further, Dr. Friedericke Gerdes joined Epigenomics as Head of
Marketing. Most recently she was Global Marketing Director at Agendia
BV (Amsterdam, Netherlands), another cancer molecular diagnostics
player. At Agendia, she was responsible for global strategic and
tactical marketing, as well as for corporate identity, product
branding and product launches. She has over twelve years of relevant
experience in various international marketing and sales positions
with companies such as Applied Biosystems and GE Healthcare /
Biacore. Dr. Gerdes holds a doctorate degree in cell biology from the
University of Kiel, Germany.
On August 5, 2008, Epigenomics' Supervisory Board and Dr. Kurt
Berlin, Chief Scientific Officer (CSO) of Epigenomics AG, agreed that
Dr. Berlin would step down as CSO and Executive Board member
effective August 31, 2008. Dr. Kurt Berlin, one of the co-founders of
the Company, now serves as chairman of Epigenomics' Scientific
Advisory Board and is continuing to advise Epigenomics on scientific,
technological, licensing and IP-related matters as a consultant
throughout 2008 and 2009.

With these management changes, Epigenomics continues to execute on
its Epi 2010 initiative introduced earlier this year to continuously
streamline operations and evolve the company into a truly commercial
organization.

First 9 Months of 2008 - Financial Review
Epigenomics' revenue in 9M 2008 amounted to over EUR 1.8 million, in
line with the EUR 1.8 million during the same period in 2007. 9M
revenues were generated from existing as well as newly signed
collaborations and licensing agreements in the form of R&D payments,
licensing and royalty income.

EBIT for 9M 2008 of EUR -8.5 million was in line with management's
expectations and showed a 16% improvement over EBIT for 9M 2007 of
EUR -10.2 million. R&D expenses dropped from EUR 7.7 million in 9M
2007 to 6.8 million with increased focus on Epigenomics' lead
programs. Cost of sales for partnered R&D programs remained virtually
unchanged at EUR 678 thousand during the reporting period compared to
EUR 671 thousand in 9M 2007.

Overall operating costs during the first nine months of 2008 amounted
to EUR 11.3 million, down 13% from the same period in 2007 (EUR 12.9
million). This improvement is an effect of Epigenomics' "Epi 2010"
initiative. At the end of the reporting period Epigenomics employed
92 staff compared to 112 employees at year-end 2007.

Net loss for the reporting period amounted to EUR -8.1 million
compared to EUR -9.8 million in 9M 2007. Basic and diluted loss per
share improved from EUR -0.56 in 9M 2007 to EUR -0.32 in the
reporting period.

Overall, the financial position of Epigenomics has developed
favorably: total balance sheet assets amounted to EUR 24.7 million at
the end of the reporting period compared to EUR 22.9 million at
year-end 2007; liquid assets amounted to EUR 15.2 million as of
September 30, 2008, compared to EUR 10.0 million as of December 31,
2007.

In 9M 2008, total net cash flow was positive at EUR 5.6 million, due
to the cash inflow from the capital increase realized in February
2008. Cash outflow from operating activities in 9M 2008 amounted to
EUR 6.9 million. Cash inflow from investing activities amounted to
EUR 1.0 million, primarily due to a premature redemption of
securities held to maturity. Cash flow from financing activities was
positive at EUR 11.5 million, due to the rights issue in February
2008 in which 8,458,062 new shares were placed at EUR 1.60 per share.

"In addition to the significant progress we have made on the
operational and product development side, the first three quarters of
2008 have been characterized by stringent fiscal discipline coupled
with stable revenue generation. Hence, we are on track for reaching
our primary financial goal of reducing cash burn to less than ten
million Euros in 2008", commented Oliver Schacht, Chief Financial
Officer of Epigenomics.

Outlook

In Q4 2008 and into 2009, Epigenomics' most advanced colorectal
cancer blood test and key value driver will remain the focus of the
Company's development and commercialization efforts. The PRESEPT
Study is expected to continue rapidly ramping up site qualification,
site initiation and sample collection towards completion in H2 2009.

In due course, the company expects its partner Quest Diagnostics to
launch a laboratory-developed test (LDT) for the detection of
methylated Septin 9 DNA in blood plasma to aid in the early detection
of colorectal cancer. It is the company's goal to enter into an
additional IVD partnership in due course. Epigenomics has ongoing IVD
partnering discussions and negotiations, and has made significant
progress during the first nine months of 2008.

Management expects full year 2008 revenue to increase only slightly
compared to 2007 revenue of EUR 2.6 million. The operating result for
2008 is expected to improve significantly and to be around EUR -12.5
million compared to 2007 EBIT of EUR -13.5 million. Epigenomics
expects net cash consumption for 2008 to remain below EUR 10 million
and therefore to be significantly better than the 2007 cash burn of
EUR 12 million.

Further Information

The full 9-Month Report 2008 can be obtained from Epigenomics'
website at:
http://www.epigenomics.com/en/investor_relations/Financial_Information/
About Epigenomics AG
Epigenomics is a molecular diagnostics company with a focus on the
development of novel products for cancer. Using DNA methylation
biomarkers, Epigenomics' tests in development aim at diagnosing
cancer at an early stage before symptoms occur and thereby may reduce
mortality from this dreaded disease.

Epigenomics' product pipeline contains a validated biomarker for the
early detection of colorectal cancer in blood plasma, and further
proprietary DNA methylation biomarkers at various stages of
development for prostate and lung cancer detection in urine, blood
and bronchial lavage specimens. Epigenomics' biomarker Septin 9 for
the early detection of colorectal cancer in a simple blood sample
demonstrated continuously highest performance in multiple clinical
studies with in total about 3,500 individuals tested.

For development and global commercialization as in vitro diagnostic
test kits, Epigenomics pursues a non-exclusive partnering strategy
with diagnostics industry companies. As a first strategic partner,
Abbott Molecular Inc. licensed the worldwide non-exclusive IVD rights
to Epigenomics' proprietary Septin 9 biomarker for colorectal cancer.
Epigenomics also aims at giving patients and doctors early access to
these biomarkers through reference laboratory testing services. As a
first reference laboratory partner, Quest Diagnostics Inc., the
leading provider of diagnostic testing, information and services,
obtained the license to commercialize a laboratory-developed test
(LDT) for Septin 9 in the U.S.

Partners in the health care industry and the biomedical research
community can access Epigenomics' portfolio of proprietary DNA
methylation technologies and biomarkers protected by more than 150
patent families through research products, Biomarker Services, IVD
Development Collaborations, and Licensing. The company is
headquartered in Berlin, Germany, and has a wholly owned subsidiary
in Seattle, WA, U.S.A. For more information, please visit
Epigenomics' website at www.epigenomics.com.

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Disclaimer
This communication expressly or implicitly contains certain
forward-looking statements concerning Epigenomics AG and its
business. Such statements involve certain known and unknown risks,
uncertainties and other factors which could cause the actual results,
financial condition, performance or achievements of Epigenomics AG to
be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements.
Epigenomics AG is providing this communication as of this date and
does not undertake to update any forward-looking statements contained
herein as a result of new information, future events or otherwise.
Contact

Epigenomics AG
Dr. Achim Plum
SVP Corporate Development
+49 30 24 345 368
achim.plum@epigenomics.com

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